Free Thai Govt Handouts Serve Only Vested Political Interests

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EDITORIAL

Free handouts serve only vested political interests

By The Nation

If the govt really wants to help the grassroots people, it should focus on land rights and farming methods

As of press time, the Cabinet was considering a nine-point welfare package put forward by Prime Minister Abhisit Vejjajiva. In spite of the public debate about the merits of the package, the Cabinet was likely to give its blessing to the package, entitled "Pracha Wiwat". The government's motive in introducing the populist package is clear. It wants to woo voters, especially the lower-income group, before the next general election. While the plan may help ease the hardship of the lower-income group of people in the short-term, there are doubts whether the money will effectively promote the general welfare of the poor.

If the government determines to go ahead with the package, it must ensure that it first produces sustainable results in promoting the welfare of the public. Secondly, it must not become another waste of taxpayers' money. And finally it must not have a negative long-term impact by making people addicted to free handouts.

However, it is difficult to be optimistic about the potential results of the Pracha Wiwat policy, even though the government claims the money spent will have a multiple beneficial effect on the economy. This is because most of the measures are clearly aimed at gaining short-term results. Critics claim they are not necessary and wasteful of government funds.

One area that has come in for criticism is the subsidising of electricity fees. The plan is to provide free electricity to households that use less than 90 units per month. But the government fails to understand that many of those users with less than 90 units per month are affluent single people or couples who can easily afford to pay their bills. In short, a large amount of taxpayers' money will be spent to subsidise the electricity usage for these consumers.

The plan to subsidise and maintain the current level of fuel prices is not wise because it will not make the public aware of the real cost of energy. A lower fuel price will simply encourage the public to consume more energy, running counter to the energy-saving campaign.

These populist measures must be followed by effective evaluation to ensure that taxpayers' money is indeed being well spent. The government's plan to provide funding to vendors and motorcyclists is an admirable idea, but other countries have experienced difficulties in producing sustainable results from such measures to extend loans to the informal sector, largely because of a lack of effective follow-up and evaluation measures. Thailand cannot afford to replicate the same mistakes. Ultimately the government must be held fully accountable for using our tax money for its own political purposes.

Another crucial question is where the funding will come from. The Abhisit government may be able to squander tax money now that the Thai economy has recovered and is growing in tandem with others in the region. However, with the US and European economies still in recession, full global economic recovery remains uncertain. The government may not be able to collect enough revenue to finance its Pracha Wiwat policies if external factors begin to pose a serious threat to Thailand. After all, we still depend heavily on external trade, and the future stability of our exports is by no means guarnateed.

Unfortunately this plan reads like so many of the populist policies championed by the Thaksin governments. In fact, criticism of the negative effects of Thaksin's populist policies were a factor that led to his eventual downfall. The long-term impact of recipients becoming addicted to handouts meant that they failed to realise the merits of hard work and prudent spending.

Abhisit shouldn't rely on fancy words to announce welfare packages to help low-income voters. In fact, as the majority of Thais are still in the agricultural sector, the government could better help these people by focusing on the core issues: a lack of farmland, poor productivity and better education for farmers. These are the issues that need to be tackled, not superficial freebies to gain short term votes.

The government should start with one priority: focusing on land ownership, which is the most critical problem for the low-income and small-scale farmers who make up of the majority of the Thai population. Ideas might be to promote collective farms or to provide small farmers with ownership rights and proper management training. When farmers can stand on their own two feet, sustainable and multiple positive effects can be created.

Taxpayers would not mind if their money was well spent on such long-term investment rather than poured down the drain every time election season comes around.

-- The Nation 2011-01-12

[rubl]

If the government ONLY had the Pracha Wiwat scheme the OP makes sense. Fortunately there is also a more longterm approach in the National Reform scheme just approved the other day. Just check here

[asiawatcher]

I would not worry about it being populist! It worked for Thaksin and there is a good chance after the election Abhisit will not want to sit in the chair so go for it - give something away and do some good with it.